Healthcare is a major expense to people in the United States, where 16% of the annual GDP (Gross Domestic Product, which is the market value of goods and services produced in the economy) is spent on healthcare related items, such as hospital and doctor visits, insurance, prescriptions, and other items. The United States spends the most on healthcare of any country in the world, without its population experiencing the health benefits (considering life span as an example) that are found in many countries that spend less on healthcare. Individual and family healthcare expenses have been contributed to more than 50 percent of personal bankruptcies in the past ten years.
What are we spending our healthcare dollars on? A report on healthcare expenditures from 2010 published by Kaiser Healthgave the following breakdown of the relative costs of various segments of the healthcare industry.
This graph breaks down how people in the United States spend their money for healthcare products services. The graph was originally published by KaiserEdu.org
As you can see from the graph, hospital and physician/clinic visits account for more than 50% of the amount spent by Americans each year on healthcare. If you’ve ever looked through your statement after visiting a hospital or doctors office, you have likely noticed how expensive it can be to spend even an hour in either of those places. Especially if you are uninsured (or self-insured as it’s also called), you feel the full effects of those costs since you are the one writing the check for the full amount (or at least close to it) of those services. Because of these high costs of visiting the doctor or going to the hospital, many people hesitate going the hospital or doctor in situations where they can avoid it.
The problem with these healthcare cost numbers is that the United States lags behind other countries in terms of wellness. The World Health Organization ranked the United States 72nd out of 191 nations in terms of overall health. This data would lead us to believe that there are some significant inefficiencies in our system, especially when it comes to hospital and clinical services.